Question : 121.BayCityMining,Inc.hasapriceof$20ashare,outstandingsharesof2.5million,retainedearningsof$1milliondollars,andadividendyieldof2percent.Ithasaprice-earningsratioof a.50,whichishighbyhistoricalstandards. : 1261790

 

121.BayCityMining,Inc.hasapriceof$20ashare,outstandingsharesof2.5million,retainedearningsof$1milliondollars,andadividendyieldof2percent.Ithasaprice-earningsratioof

a.50,whichishighbyhistoricalstandards.

b.50,whichislowbyhistoricalstandards.

c.25,whichishighbyhistoricalstandards.

d.25,whichislowbyhistoricalstandards.

122.AlphaCorporationhasapriceof$5ashare,outstandingsharesof2.5million,retainedearningsof$1milliondollars,andadividendyieldof2percent.Ithasaprice-earningsratiowhichis

a.high,perhapsindicatingthatpeopleexpectfutureearningstorise.

b.high,perhapsindicatingthatpeopleexpectfutureearningstofall.

c.low,perhapsindicatingthatpeopleexpectfutureearningstorise.

d.low,perhapsindicatingthatpeopleexpectfutureearningstofall.

123.AlowP/Eforastockindicatesthat

a.peoplemayexpectearningstofallinthefuture,perhapsbecausethefirmwillbefacedwithincreasedcompetition.

b.itsdividendshavebeenlowsothatnooneiswillingtopayverymuchforit.

c.thecorporationispossiblyovervalued.

d.Alloftheabovearecorrect.

124.SupposeSarahLeeCorporationstockhasaP/Eratioof8.ThisP/Eratioisrelatively

a.low,indicatingthatbuyersmayexpectearningstorise.

b.low,indicatingthatbuyersmayexpectearningstofall.

c.high,indicatingthatbuyersmayexpectearningstorise.

d.high,indicatingthatbuyersmayexpectearningstofall.

125.Whichofthefollowingiscorrect?

a.Joantakessomeofherincomeandbuysmutualfundshares.Joan’spurchasewillbeincludedintheinvestmentcategoryofGDP.

b.IfashareofstockinVirtualPizzaCorporationsellsfor$77,theearningspershareare$5,andthedividendpershareis$2,thentheP/Eratiois11.

c.Inordertouseequityfinance,afirmmustsellaboutequalvaluesofstocksandbonds.

d.Noneoftheaboveiscorrect.

Usethefollowingtabletoanswerthefollowingquestions.

 

Table26-1

 

Stock

Sym

Yld%

P/E

Vol1000s

Hi

Lo

Close

NetChg.

GenMills

GIS

3.0

18.4

1659

51.57

51.10

51.09

–0.06

Microsoft

MSFT

2.6

18.6

20,315

36.15

35.59

35.67

0.02

Graco

GGG

1.5

25.3

101

68.39

67.63

68.09

0.00

Hershey

HSY

1.8

29.9

956

83.62

82.87

83.38

0.13

 

126.RefertoTable26-1.Indollarterms,whichcompanypaidthehighestdividendpershare?

a.GenMills

b.Microsoft

c.Graco

d.Hershey

127.RefertoTable26-1.WhatwasHershey’searningspershare?

a.$29.90

b.$2.79

c.$1.50

d.$0.36

128.RefertoTable26-1.Assumethattheclosingpricewasalsotheaveragepriceatwhicheachstocktransactiontookplace.WhatwasthetotaldollarvolumeofGracostocktradedthatday?

a.$68,770,900

b.$6,877,090

c.$687,709

d.$6,877.1

129.RefertoTable26-1.WhichfirmhadtheP/EratiothatwasclosesttothehistoricallytypicalP/Eratio?

a.GenMills

b.Microsoft

c.Graco

d.Hershey

Usethefollowingtabletoanswerthefollowingquestions.

 

Table26-2

 

 

Stock

 

Sym

 

Yld%

 

P/E

 

Vol1000s

 

Hi

 

Lo

 

Close

NetChg.

BoeingCo.

BA

1.90

19.83

10,325

105.65

103.10

101.87

-1.99

EliLilyandCo.

LLY

3.80

12.41

1,794

51.72

51.17

51.45

0.02

KraftFoodsGroup

KRFT

3.50

21.42

1,078

56.51

57.75

56.69

0.04

KelloggCo.

K

2.60

26.18

680

66.25

66.69

66.50

0.12

130.RefertoTable26-2.Whichcompanyhadthehighestdollardividendpershare?

a.BoeingCo.

b.EliLillyandCo.

c.KraftFoodsGroup

d.KelloggCo.

 

 

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